BUILD DATA CENTERS

“We will get a lot of business from data centers, but not just on the installation. Data centers need roofs too. Data centers need waterproofing, very much so. Data centers often need lumber related products. So so data centers are big consumers of building products. Now TopBuild itself has single digit percentage exposure to data centers, but it's very fast growing.”

“The AI race is so intense. It's now time to power, right? I need power, I don't care how you make it. If you talk about a gigawatt data center, that's almost a million US households of energy. The grid is just really not built for that. What that means is the data centers now have to bring their own power online because it's also important that when you plug in a data center, it consumes a lot of power from the grid.”

“I am constantly telling everybody, run to the light. Do the do the problem solving. Get into the fact full zone, but don't reject change out of fear. Let's make sure we understand with great facts where we're going and how we get there.”

“The acquisition of Beacon following the acquisition of Kodiak, which is followed now by the acquisition of TopBuild, takes us from eleven months ago where we had no building products revenue, let alone EBITDA, to the second largest publicly traded building products distributor in North America with more than $18,000,000,000 in combined company revenue and more than $2,000,000,000 of combined adjusted EBITDA. It's a big deal in the industry and a big deal in the market as a whole.”

“Lots of people that have rural lands and there's also a big power line that comes through their land go, I can build a data center here. And they might have been able to get $5,000 or $10,000 an acre, but if they can get a large load interconnect, they can get $100, $200, $300,000 an acre for the same land. So you see a lot of people that came in and said, okay, if I can find the sweet spot of land where I can get gas and water and power and all these things, all of a sudden the value of that land goes through the roof and the data centers are willing to pay for it.”

“The three elements are the optical table, so these lenses, and then you have the heat battery and the PC, or the power conversion unit, all in this kind of container. And the idea is that we capture energy from the sun throughout the day. So think of this as like a solar panel, but that has a built-in battery, and that essentially you can scale linearly to any project size. If a datacenter customer needs 100 megawatts or a gigawatt, you just stack these next to each other.”

“Chuseong Lee and I worked well together. We had a rhythm that I think is really important. We spoke every morning in order to clear what we were working on... part of working together and and leading is to make sure you have you have established rhythms, that force you to say, well, there's nothing for us to talk about today. Or listen, you know, there's seven things we gotta talk about, and here they are.”

“I mean, the DMV, which is the second largest interaction with citizens, the the the the motor vehicles department, still runs off of a mainframe that's 30 years old that was, built and maintained by IBM who doesn't maintain it anymore. I mean, that's what we were dealing with.”

“Pace matters. And I don't, care whether you're a one term governor or two or you have unlimited terms. Pace matters in everything. The the greatest greatest detriment to success is going slow. And, in this case, in my term, it was it was reinforced by the fact that I had four years to try to get eight years of work done, and I think we delivered even more than that.”

“If you actually start to look at the load profile of an AI data center, it's one of the most volatile loads you've ever seen. 12, 14 times a minute load swings that are 30, 80 percent the size of the data center. And that's wreaked havoc on these data centers moving quickly because it's tearing up gen sets. They're literally breaking the crankshaft of the gen sets. They're burning through batteries. And it's a lot of these data centers that are all about time to power and moving quickly. And they got ahead of the tips of their skis because they didn't architect the infrastructure correctly for it to succeed.”

“We worked for over three years, and we got 25% of Virginia's regulations streamlined. And then I said, well, no. I want 35%. And everybody asked the question, how are you gonna do that? And, and I said, let's go get let's go get some some really innovative AI thinkers here. And what we can do, we we brought in a company called Vulcan Technologies, a startup out of at Austin, Texas. And, and we worked with them for about three or four weeks... And lo and behold, within a few weeks, they came back and said, we think we can get another 15% out. And that now what I laughed about was I said, wait a minute. We worked for three years to get 25% out, and you're gonna work over the next six months, and you're gonna get another 15% out? And they even might have said 20. And I said, where were you guys three years ago? And they said, well, in high school.”

“They're gonna go to Tennessee, North Carolina, South Carolina, Georgia, Florida, Texas. I mean, this is the SEC in economic development. I mean, these guys these guys are winning everything. I mean, there are basically 10 states in The United States Of America that are driving the vast majority of job growth, driving the vast majority of economic growth. And by the way, those are the states that are getting the vast majority of population movements.”

“The old economy is still here. It's not generative AI, but it's arguably maybe it's even more important. You couldn't have the new economy without cooling and heating. The actual business of making things and moving things, heating and cooling, is very much enmeshed with the new economy, which is all about generative AI.”

“When we complete the merger, we'll be number one in insulation, we'll be the second biggest in roofing, will be number one in waterproofing, and will hold number one or number two positions in certain geographies within lumber and building materials. So we'll have a huge addressable market, several $100,000,000,000.”

“I think there's a lot of headlines about data center projects being planned or initiated. I don't think all of them are actually happening. So there's a lot of like phantom data centers that are being announced. Let's call it that way. I think data centers are definitely in a rush to get online fast. They do have massive supply chain constraints. Two years ago, it was maybe NVIDIA GPUs. Now, it's power. Now, it's actually not even hardware. It's actually labor.”

“Every electric utility that's an investor-owned utility is publicly traded. When you listen to the conference calls of all of those CEOs the last three months, they are firmly blaming data centers for rate increases. They have added like 40% to their budgets since 2024, right? That means that they said before we're raising rates 5%, now they're raising rates 9%, right? They separately had a report last year that said they were going to spend a trillion dollars between 2025 and 2029 investing in the grid. This year, they just re-upped that from a trillion to 1.4 trillion from 2026 to 2030.”

“The last thing about everyone coming out of Tesla, you're obsessed with vertical integration, you want to build everything in-house. We haven't done that at Exowatt to that extent yet. We've started working with contract manufacturers because we know we need to scale fast quickly, so they have that infrastructure. But Elon really taught us how to vertically integrate everything and build it yourself and build it better, faster, cheaper, and don't take no for an answer.”

“If you look at the Stargate 1 project, by the time they completed building the first few buildings, they were already like four GPU generations behind, right? And so the difficulty with building these massive structures and building a whole city around it is one, the staffing you need in a specific location, and two, the capital, and then three, the lead time to everything. When you do modularize like AI in a box that you can just drop the container off and when that container becomes out of date, you pick it up, take it back to the factory and drop another one off, I think you're going to see the AI factory change.”

“This essentially focuses the light coming in from the sun onto the battery material. It gets very hot and then stores that energy. So, essentially, our battery is a heat battery, so what that means is we're heating up rocks, right? And then storing that energy in formal heat, which is very cheap as compared to doing lithium ion or any other type of electrochemical battery, and you don't have to get lithium or magnesium or cobalt or any of these other fancy chemicals.”

“Texas has passed SB6, as Jon suggested, which basically says that if there is ever a shortage of power in the state of Texas, data centers go offline first. So that should be the law of the land. That's called an interruptible tariff. It's been around for 50 years. It is not new and all data centers should be required to sign one. There are companies like Gridcare and Google Tapestry and Camu Energy and others who can use that data to tell you exactly where there's space on the grid today. There's 100,000 megawatts by the way of space on the grid.”

“I mean, Loudoun County gets in excess of 25% of their county tax base from the data center community, which is keeping real estate taxes down. It's building fire stations and schools. And, I mean, this is exactly what this big tax base is all about. They have some of the best schools in the world based on based on some of these things.”

“So much of that is the the ill fated, decision that was made to decommission base load power around the country. It was it was one of the dumbest decisions that has ever been made. Nuclear and nuclear and and gas and and and a lot of coal plants that are that need to be maintained. They're cleaner today, and we can have an all of the above approach.”

“They can't build more than 50 gigawatts of data centers between now and 2030 because of limitations on GPUs, memory and CPUs, right? But if you go to communities, they're creating havoc at the level of 500 gigawatts across the country. So they are making empty promises to people across the country to disrupt their communities when they don't have the GPUs to fill it, right? In the state of Texas, they are suggesting an official ERCOT letterhead, which is the transmission operator in Texas, that the load queue could be 300 gigawatts, right? Now, mind you, Texas is 70 gigawatts. That's a BS number, right?”

“Everywhere I go, every group I I speak with, I always tell everyone that when you go through your midlife crisis like I did, run for office. Run for office. The water is fine. It's extraordinary. I've never felt more purposeful in my life, other than other than when I found my faith and and when my wife said yes, when I asked her to marry me.”

“When President Trump trumpets how many tankers are heading towards Texas to pick up product, they are picking up product to take it to other continents. So they are picking up jet fuel, they are picking up diesel, they are picking up gasoline. Because we got a lot of it. Now, if we start shipping it all to other places, our prices are going to go up. Diesel is up to $6, $7 a gallon, gasoline is above $4 a gallon. So when you think about 4.5 million households in the Northeast are still using fuel oil to heat their homes. That fuel oil comes from the Straits of Hormuz. And so now they don't have fuel oil, right?”

“We need to manufacture domestically. We need to source domestically. We need to make this using raw materials that don't come from China, that are not rare of minerals. And all of that is what we continue to iterate on. So every configuration that we design, we looked at the bill of materials or the BOM. And we asked ourselves, what can we eliminate from this? How can we make this simpler? And the same approach you see at SpaceX, right? Or at Tesla.”

“TopBuild is the largest installer and distributor of insulation. And as you were just saying, everybody needs insulation. Every house needs insulation in the walls. Every office building needs insulation everywhere. It's a needed product, and it's not going anywhere.”

“When you look at our grid, if the data centers were willing to be flexible with their load for 100 hours, you could accommodate 100 gigawatts of data center load growth in our grid easily and reduce everyone's electricity bills by 10%. But that would require coordination between the data center and the utility and the governors and folks would have to like each other. But instead, they're saying, screw you, we'd like to be run off grid, right? Okay, that feels very selfish.”

“We put in an OKR system right out of the box, and we set objectives. We figured out what we were gonna measure, and we had rapid feedback for the entire state government organization. And there was huge resistance at the beginning, and then leadership began to understand that as they were running their agency or their department, they had a they had real guideposts on what success looks like. And when they were behind, we were able to recalibrate with more resources and to support. And when they were ahead, we were able to celebrate and then set even more challenging aspirations.”

“What's new about our approach and our hypothesis is making this in a modular fashion, making this in a factory, and then scaling the production to millions and ultimately billions of these, which ultimately allows us to go down the cost curve and generate electricity at our ultimate goal of one cent per kilowatt hour. And so that's why we started the company. That's kind of been the goal North Star from the beginning.”

“I don't think people contextualize how much energy that is. So if you talk about a gigawatt data center, that's almost a million US households of energy. So if a data center says, I'm building a five gigawatt data center, I'm basically building a city that's five million households. And they're building in a very tiny footprint, although not so tiny. The funny thing about data centers is, when they start talking about buildings in acres, you can start realizing how big these buildings are.”